WASHINGTON – The White House and congressional democrats announced agreement on a “framework” for a reconciliation bill that will spend nearly $2 trillion and includes a wide range of policies. CEI experts focused on issues ranging from energy and environment to regulatory process reform to international trade reacted to the latest provisions.
Vice President for Policy Wayne Crews said:
“A major overarching destructive element of the so-called Build Back Better agenda is the escalation of the central administrative state it will entail. In turn, anti-democratic and unaccountable government will dominate. We already are seeing under Biden the unleashing of executive orders and ‘guidance documents’ as distinct from legislation and notice-and-comment regulation. These developments point to a private sector increasingly rendered unable to act without government guidance at every turn.”
“It is vital for a more rational set of politicians to seize this moment and secure an America safe for the creation of intergenerational household wealth, not one saddled with intergenerational debt.”
“The reality is that coronavirus never posed a threat to the radical progressive project. Quite the contrary, as many have pointed out, the contagion was seized upon to advance an in-progress agenda. Each successive spending package, culminating in BBB, has less and less to do with crisis. This is a reason an Abuse-of-Crisis Prevention Act is urgently needed, incorporating a vision to shrink the federal government to a tiny fraction of its current bulk and let individuals, business and state and local governments keep their wealth right where it was earned, not send it to Washington to waste.
“The Biden agenda offers no prospect for expanded resilience with respect to the next economic shock but instead only adds more layers of government debt and makes vulnerability far worse. That of, course, is a feature rather than a bug to the left who will exploit tomorrow’s crises with added zeal. There must instead be an ambitious agenda to streamline and compartmentalize the federal government within rational, constitutional bounds. With an ‘Abuse-of-Crisis Prevention Act,’ the nation can also achieve an overdue restoration of a culture defined by the ‘silken bands of mild government’ benefitting from the growth, wealth and resilience that ethos permits, as well as discipline the exploitation and political predation masquerading as public policy today.”
Senior fellow Ben Lieberman said:
“There was much debate over tax increases on the rich that were subsequently dropped from the final reconciliation package, but one tax break for the rich was actually increased. The tax credit for purchasing an electric vehicle (EV) has been boosted from the current $7,500 to as much as $12,500, even though most EV buyers have household incomes in excess of $100,000 per year. In effect, all taxpayers, wealthy or not, will be subsidizing those who buy EVs.”
Senior Fellow Michelle Minton said:
“It is encouraging that the latest version of the bill scrapped the disastrous plan to tax smokers, most of which make less than $400,000 a year, simply for trying to improve their health by switching to lower risk nicotine products, like e-cigarettes.”
Senior Fellow Ryan Young said:
“There are two reasons for passing the infrastructure and reconciliation spending bills: fighting COVID and helping the economic recovery. They fail on both counts. Congress should turn to other policies instead. These include speeding up the FDA’s approval process for medical treatments, and lifting regulations, tariffs, permits, and licenses that are sludging up supply networks.
“Federal regulations currently cost more than $14,000 per household. Lightening that load by as little as ten percent would be an enormous stimulus that requires no new deficit spending.
“Most of the 1,684 page reconciliation bill consists of COVID-unrelated wishlist items such as more than $14 billion for forest restoration; $50 million for water research; $1 billion for antitrust enforcement; and billions of dollars in subsidies for private businesses with the right political connections.
“Because all that money has to come from somewhere else, stimulus is at best a zero-sum game. The spending bills are not creating new wealth, they are reshuffling existing wealth. Since funding is decided by politics rather than merit, the bills are almost certainly a net loss to the economy, even compared to doing nothing.
“The spending bills will use up nearly $3 trillion in capital that instead could have helped struggling businesses take loans to stay afloat or grow; that could have gone towards adapting supply networks to post-COVID conditions; and that people could have invested in themselves to improve their future prospects.”
Senior Fellow John Berlau said:
“The legislation’s ‘First Generation Downpayment Fund’ is a recipe for another housing bubble and bust. The provisions that give borrowers up to $20,000 to cover a downpayment mean that many borrowers would be paying zero in down payment costs and may be entering into the loan without the demonstrated ability to make mortgage payments. In the runup to the mortgage crisis of 2008, lenders — with government encouragement — made loans with minimal or zero down payments with the expectation that housing values would always go up. When housing values slowed, many of these loans went into delinquency or foreclosure, further spiraling the housing bubble out of control. Instead of this reckless giveaway. Congress should remove regulatory barriers to saving for homes and to building more affordable housing.”